Coinbase (COIN  ) announced on Thursday that it will be investing $500 million into a "diverse portfolio of crypto assets". The cryptocurrency exchange platform has also committed to investing 10% of its net income into this portfolio on a quarterly basis.

"This means we will become the first publicly traded company to hold Ethereum, Proof of Stake assets, DeFi tokens, and many other crypto assets supported for trading on our platform, in addition to Bitcoin, on our balance sheet," Coinbase finance chief Alesia Haas said in a blog on the company's site.

Coinbase's CEO Brian Armstrong posted on Twitter (TWTR  ) about the upcoming investment before the official statement was released. Armstrong predicts that the company's investment in crypto will only grow over time as the market becomes more mature.

"Hopefully over time we can operate more of our business in crypto," Armstrong wrote on Twitter. "Today it is still a mix."

The Friday following the company's announcement, after sitting below $45,000 for two days, the price of bitcoin rose to $47,000. Meanwhile, Coinbase shares rose by 4% to $258 per share by that morning.

Coinbase's crypto investments "will be driven by our aggregate custodial crypto balances", giving customers control over the company's strategy.

"Our investments will be continually deployed over a multi-year window using a dollar cost averaging strategy," Haas wrote. "We are long term investors and will only divest under select circumstances."

"All trades will be executed via our over the counter desk or away from our exchange to avoid any conflict of interest with our customers," Haas continued.

As Haas acknowledged in her blog, Coinbase isn't the first company to have bitcoin in its holdings. Both Microstrategy and Tesla (TSLA  ) have purchased bitcoin through Coinbase in order to protect themselves from inflation and a potential dip in the power of the U.S. Dollar.

While Coinbase's crypto-announcement has had a relatively favorable reception, on Thursday, CitiBank (C  ) downgraded its rating for Microstrategy to "sell" after the company's announcement that it would be offering a $400 million convertible note to fund further bitcoin investment. Microstrategy currently holds 40,824 bitcoins, roughly $2 million.

"Recent insider selling has been significant and broad-based, and suggests shares may be overvalued," Citi analyst Tyler Radke wrote in a statement. "Much of the management team may not be as optimistic on bitcoin or fundamentals as chairman/CEO Saylor."

Microstrategy CEO Michael Saylor says he owns 17,732 bitcoins himself. Radke argues that Saylor's focus on bitcoin is a detriment to employee sentiment at the company as well as the overall functionality of the business.

Coinbase, on the other hand, is diversifying its investments beyond its digital assets and seems to be thriving. In preparation for a possible tightening of regulations by the Securities and Exchange Commission, among others, Coinbase has recently gathered $4 billion in cash.

The company also saw an impressive $2.23 billion in total revenue in the second quarter of this year, compared to $186 million during the same period in 2020.